A mantra is taking hold in Day Hall: Restructure rigorously, responsibly and humanely.
Paul Streeter, associate vice president, has adopted those watchwords as he works to balance the university's budget -- by making Cornell more efficient.
Since the 2008 economic downturn, the university has been paring down its budget deficit, but significant challenges remain. The estimated deficit for the current year is $68 million, and if no action is taken this deficit could grow to $85 million next year alone and even higher in subsequent years. Streeter is directing an effort to significantly whittle down the deficit by saving $90 million annually in administrative costs by 2015.
"We do need to balance our budget within the next three to four years. We don't have a choice about that," said Streeter, who has 23 years of experience at Cornell, much of it evaluating and recommending improvements in university operations. "What we're trying to do is make budget reductions, but also eliminate bureaucracy. We are aggressively pursuing savings opportunities that don't affect positions, but we do recognize that staff layoffs and position eliminations are inevitable. We must be thoughtful, methodical and objective in our review and decision-making processes to minimize the number of position eliminations and to make sure that our support systems and structures work most effectively with fewer resources."
Provost Kent Fuchs announced the creation of the Initiatives Coordination Office (ICO) (initially termed the Project Management Office) Dec. 16 and named Streeter to lead the effort. Fuchs charged the office with helping the university achieve operational savings in five areas:
- Information technology;
- Finance, human resources and communication; and
- Organization and management of support activities.
Streeter is coordinating five teams -- one for each area -- led by deans, vice presidents and other senior administrators, who will ultimately report to Fuchs and President David Skorton. (The teams and their tasks are listed at http://www.cornell.edu/reimagining/initiatives.cfm.) Each team has analyzed savings targets and is creating detailed implementation plans to meet those targets. Streeter will act as "air-traffic controller," he said, to coordinate their work.
Streeter is well prepared for his tasks ahead; before taking on the ICO, he was Cornell's assistant vice president for planning and budget for three years and interim vice president for budget and planning for 16 months. He worked four years as senior project director in the Division of Planning and Budget, four years as director of finance and administrative operations in the College of Human Ecology and nine years in the Cornell Audit Office, serving as the associate audit director for five years. Streeter, who has an MBA from Cornell, is also a certified public accountant.
As Fuchs and Skorton announced in fall 2009, non-personnel savings will account for at least half of the $90 million target. Much of that savings will come from energy conservation and purchasing, primarily through negotiating lower prices from fewer vendors, Streeter said. "We think by actively managing our spending activity, we can realize significant savings."
But the remainder will have to come from personnel reductions over the next five years, Fuchs said Dec. 16. "We have made it clear that decisions on personnel actions, including attrition and layoffs, will be sensitively carried out and will not be made until planning efforts are complete for maximizing the amount of nonpersonnel savings that can be achieved," Fuchs said.
The ICO is part of the administration's three-pronged effort to "reimagine Cornell." While the ICO is cutting administrative costs, Fuchs is considering recommendations from 20 academic task forces on ways to strengthen the university's academic enterprise with tighter budgets. At the same time, a committee headed by Ed Lawler, the Martin P. Catherwood Professor of Industrial and Labor Relations, is drafting a strategic plan, to be released this spring.